Clear Picture Logo
Menu

Latest News

How Do I Resolve a Dispute With My Supplier?

Share this article:

Having good working relationships with your suppliers is vital to ensure your business runs smoothly.

.

Although you have likely taken the time to find the right suppliers for your business and build good relationships with them, it is important to know what to do if any issues arise. This article will outline how you can handle a dispute with your supplier and offer tips on how to avoid conflict.

Dealing With a Dispute

Most of the time, your business can resolve disputes quickly and efficiently without the need for legal assistance. Before communicating your concern with your supplier and considering taking legal action, you should always read through the terms and conditions of any agreement you have with them, such as a supply agreement. Reading these terms is important because you do not want to escalate your dispute unnecessarily. You should ensure you are clear about the terms your supplier has breached and what remedy you may have. Importantly, contracts such as supply agreements often outline a dispute resolution process which is a process that parties must follow if a dispute occurs before moving to formal legal action. In this case, you must ensure that you comply with each step in that process. Otherwise, you may lose your right to pursue the matter further. 

This article will outline what you can do if you do not have a supply agreement or other contract in place.

1. Contact Your Supplier

After reviewing your contract and understanding your position, you should try to resolve the matter directly with your supplier. More often than not, the supplier may not be aware of the issue. When contacting your supplier, you should ensure you communicate effectively by:

  • explaining the issue;
  • listening to your supplier’s response; and
  • trying to understand their position. 

The goal of this initial call is to negotiate an agreement that works for both you and your supplier.

You should always keep records of communication you have with your supplier. This is because if the matter escalates, it will be useful to demonstrate what matters were raised or agreed upon between the parties. For example, if you discuss issues over the phone, you may want to follow up with an email confirming what was discussed and identify any action items. You should ask the recipient to reply by email to either agree or correct the record of that conversation. 

2. Issue a Formal Letter of Demand

If the matter continues or you have been unable to get in contact with your supplier, the next step may be to issue a letter of demand. A letter of demand is usually a necessary step before you can escalate the matter further.

A letter of demand should set out your:

  • legal claim;
  • rights; and
  • demand for compensation, refund or performance of the other party’s obligation.

You can also include a time limit that your supplier must comply with before you consider alternative legal avenues. While a letter of demand can be an informal document, it is important to ensure that you present your argument effectively. It should include a clear structure, all relevant details and a concise legal argument. It is crucial your letter at least includes:

  • a summary of your contract with the supplier;
  • details of the breach of contract;
  • damages you suffered;
  • a demand for remedies such as compensation; and
  • your intention to consider taking the matter to court if the supplier does not comply.

There is no requirement for a lawyer to issue the letter of demand on your behalf. However, there are some benefits to having a lawyer issue it as they may be able to:

  • advise on your legal position under the supply agreement and provide possible options available to the supplier; 
  • identify additional ways to take action against the supplier;
  • recommend a strategy; and
  • add authority to your letter and provide extra ‘motivation’ for the supplier to comply or reach an agreement with you.

3. Contact a Resolution Authority

If the letter of demand does not work, you can seek the assistance of agencies or industry associations that offer help for free or for a cost-effective fee.

Some useful contacts and places to contact for help include the following:

  • Australian Small Business and Family Enterprise Ombudsman
  • Consumer Protection Agencies of your local state or territory
  • Industry Ombudsman and Dispute Resolution Schemes
  • Australian Competition and Consumer Commission
  • Small Business Commissioner in your State or Territory 
  • Fair Trading 

These organisations can assist by facilitating mediation between parties or reaching out to the supplier to prompt them to resolve the dispute directly with you.

4. Take Legal Action

If the previous steps fail, you should seek independent legal advice. A lawyer will review the situation as a whole and advise you on the most appropriate next steps. It may be that you are entitled to start a claim in a small claims court or tribunal in your state or territory. There may be a case where your lawyer exhausts all dispute resolution options, and the dispute is still unresolved. If the dispute also involves a substantial amount of money, a potential next step is to commence formal court proceedings.

Litigation is costly, and there is no guarantee that you will be successful. If you are unsuccessful, the court may require you to pay part of your supplier’s legal costs. Likewise, if you are successful, there is a possibility that you may recover some of your legal costs from your supplier. 

Litigation can also be very time-consuming and stressful. It can divert resources and attention away from your business. As a result of these risks, it is essential that you consider all alternative options and the pros and cons of taking legal action before you do so. 

Avoiding the Dispute

While it is important to know how to handle disputes as they arise, preventing them from happening in the first place is essential. Below are two key tips to help you do so. 

1. Negotiate a Good Contract

A good supply agreement will protect your business if your supplier fails to meet their obligations. At a minimum, your supply agreement should include clauses relating to:

  • pricing;
  • volume;
  • payment;
  • exclusivity;
  • duration;
  • product quality, recalls and unusable products;
  • labelling requirements; and
  • the dispute resolution process.

2. Do Your Due Diligence

You should make sure you have a solid foundational understanding of the supplier you are interacting with. Therefore, you should do background checks on your suppliers before you sign with them. You can also look up their ABN to identify the person operating the business and search for them through the ASIC Business Checks app.

Key Takeaways

Having a well-drafted supplier agreement may prevent a supply issue from arising or set a clear process to resolve any issues efficiently. However, if a dispute does arise, you should:

  • understand your position under the supply agreement;
  • talk to your supplier; and
  • ask for help from a third-party dispute resolution provider.

If these steps fail, you should contact a lawyer to advise you on your position and recommend a strategy or commence a claim on your behalf. However, litigation is expensive and time-consuming and should be considered carefully.

 

 

 

Amelia Bowring Stone - Senior Lawyer
March 20, 2024
legalvision.com.au

Share this article:

Clear Picture Logo

Liability limited by a scheme approved under Professional Standards Legislation.

Craig Byron

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Fusce efficitur ligula id justo blandit, sit amet accumsan magna scelerisque. Phasellus tincidunt ipsum nec semper sagittis. Suspendisse suscipit, orci sed gravida dapibus, elit est porta ligula, vel convallis metus urna et ante. Pellentesque aliquam erat sodales sem blandit, ac facilisis magna mattis. Aliquam id lorem eu mauris bibendum facilisis in sit amet leo.

Morbi non ante vitae velit vehicula vehicula vitae euismod ex. Ut pretium rhoncus lacus in tincidunt. Suspendisse vulputate, diam eget viverra feugiat, magna velit scelerisque velit, vel posuere eros sem ut felis. Sed pellentesque justo in eros iaculis, et consequat nibh sollicitudin. Ut facilisis sit amet turpis sed cursus. Sed tincidunt neque arcu, a rutrum lectus elementum quis.

Vivamus nisi lectus, malesuada vel maximus a, lobortis in justo. Donec turpis diam, consectetur eu justo ut, accumsan malesuada nisl.

Tax and BAS returns

Taxation

The implementation of effective tax strategies is an integral part of the financial planning process. Structuring the way in which you receive your salary, superannuation contributions, investments, risk and debt management can significantly minimise your tax implications and are an essential component of your wealth creation and retirement strategy.
At Clear Picture, we want you to accomplish your financial objectives in the most tax-efficient manner as other aspects of your financial plan become easier to implement when your tax liability is minimised.
Our strategies are tested, proven and successful. We offer a broad range of taxation advisory services including:
  • Income Tax
  • Capital Gains Tax (CGT)
  • Superannuation & Transition To Retirement
  • Salary Packaging and Fringe Benefits Tax (FBT)
  • Land Tax and Stamp Duty
  • There are numerous tax effective financial planning strategies that may be appropriate for your circumstances and enhance your tax, retirement and wealth objectives. Contact our team to discuss the possibilities.

---------------------

BAS

Lodging your BAS correctly and on time can be a difficult and confusing process. You can avoid risk and stress simply by being confident that your ATO tax liabilities and obligations are sorted and your BAS lodgement is correct every time.
It’s not surprising that peace of mind for many business owners comes with appointing an experienced agent to look after their BAS services for them.
Our friendly, service orientated team offer a range of BAS services and lodgement options to suit all small business owners so you have more time to do what you do best – running your business and earning money.
Services include:
  • Preparation of Business Activity Statements from business data
  • Electronic Lodgement of Business Activity Statements
  • Personalised advice on BAS provisions (including GST, PAYG, Withholdings and Instalments, Fringe Benefits Tax, Fuel Tax Credits and more)
  • Preparation of Instalment Activity Statements and Employee Payment Summaries
  • Management of financial data files and preparation of reports for business tax returns
  • Handle payroll and superannuation obligations including Reportable Employer Super Contributions
Contact Us

Accounting

Straight forward and stress-free accounting services are what businesses of all sizes need form their accountants and we believe we provide exactly that. By providing cutting edge accounting and taxation services, and using the right products for your record keeping, our team at XX will work closely with you to ensur we understand your needs. Only in this way can we help you achieve your goals, help you manage your cash flow and help you meet your tax obligations.
While fiscal compliance is of the upmost importance, we also believe in offering professional management advice and support at all times. We are committed to offering the highest level of friendly and professional service and welcome the opportunity to work with you.
The areas we specialise in are as follows:
  • Accounting & Tax Consultancy Services
  • Personal & Business Tax Returns
  • Annual Reporting
  • Business and Tax Advisory
  • Business ‘start up’ advice
  • Prepare Business plans and financial budgets and review these regularly
  • Measure your performance against industry benchmarks
  • Trust & company structures
  • ATO correspondence Management
  • Taxation – GST & PAYE advice, BAS preparation
  • Liaise with the ATO on your behalf
  • Self-Managed Super auditing
  • Accounting software advice and assistance

Bookkeeping and Payroll


Bookkeeping

Clear Picture can take over all, or some of your bookkeeping activities allowing you to concentrate on growing your business.
We can:
  • Design, establish and review accounting systems and software
  • Perform checks, reconciliations and end of financial year reports
  • Manage your accounts receivable and accounts payable
  • Ensure your business is up to speed with legislative requirements and management reports
  • Undertake payroll duties and compliance
  • Prepare and lodge BAS statements
  • GST & PAYE advice
  • BAS Lodgement
  • GST Reconciliation
  • PAYG Withholding & Superannuation reports
  • Completing expense reports
  • Direct to bank account transactions
  • Organising your documents and records
  • Data / ledger entry
  • Paying bills
  • Completing expense reports
  • Direct to bank account transactions
  • Provide general business administrative support

---------------------------

Payroll

We can assist you with all facets of payroll and reportable contractor payments. Our professional team are fully versed in all legislative requirements and the processes required in managing this crucial part of your business.
The primary objective of payroll processing is to ensure that employees receive all the financial entitlements they are owed in a timely manner.
Poor payroll processing can be very detrimental to a business as it can significantly impact net income and lead to disgruntled staff. With an abundance of legislation, payment methods and withholdings, payroll management can be a difficult and time-consuming process.
Payroll processing services include:
  • General Payroll – ensure your staff are paid the correct rates and paid according to the correct hours worked.
  • Payslips – Our team can prepare your staffs payslips on your behalf and email them directly to you or your staff along with
  • PAYG Withholdings – Any business that has employees or pays employees of another business must withhold an amount from payments made to them. Any payments made to a business that doesn’t quote an ABN on an invoice or other documentation must also have an amount withheld from payments.
  • Taxable payments reporting – Businesses in the building and construction industry need to report the total payments they make to each contractor for building and construction services each year. These payments need to be reported to the Australian Taxation Office (ATO) on the Taxable Payments Annual Report, or electronically.
  • Entitlements – calculation of leave including holiday, personal, long service and rostered days off.
  • Payroll Tax, Workers Compensation Insurance, Employment Forms – some or all of these may be needed for your business.
  • Efficient and Electronic systems – these should simplify all processing and provide greater security for you and your staff.
  • Superannuation should be calculated and paid – this is a compulsory whereby employers are required to pay a percentage on top of “ordinary time’s earnings” to a nominated superannuation fund. These contributions need to be made at least once every three months and penalties for late payment are very severe.
  • End of Payroll Year Processing – Reconciling, Generation and Lodgement of employment group certificate’s and payment summaries, taxable payment summaries, reportable fringe benefits and lump sum amounts

Business start ups

There are four main business structures commonly used by businesses in Australia and we can help with them all:
Sole trader: an individual operating as the sole person legally responsible for all aspects of the business.
Partnership: an association of people or entities running a business together, but not as a company. A partnership is relatively inexpensive to set up and operate.
Company: a legal entity that is separate from its shareholders.
Trust: an entity that holds property or income for the benefit of others. Trusts require a formal trust deed that outlines how the trust operates, requires the trustee to undertake formal yearly administrative tasks and if you operate your business as a trust, the trustee is legally responsible for its operations. A trustee of a trust can be a company, providing some asset protection.
It is important to note that you can change your business structure throughout the life of your business.
Before commencing a new business, the following are some of the key items that need to be considered:
  • Decide on the most suitable structure for your business – sole trader, partnership, trust or company
  • Prepare a business plan, cashflow projections, budgets, and trading forecasts
  • Assess your finance requirements, advise on the best sources of finance, and draw up the necessary proposals
  • Establish a good working relationship with your bank
  • Register for a Tax File Number and an Australian Business Number with the ATO
  • Complete registration procedures with Australian Securities and Investments Commission
  • Deal with company secretarial issues
  • Set up a recording system for your internal use and for complying with statutory requirements

Each new business is different and needs to be considered in relation to your individual circumstances and our experience can ensure you are maximising your opportunities.

Consulting

Tax & Accounting Consultancy Services

Management Accounting includes the preparation of management reports and accounts that provide accurate and timely financial and statistical information. Information required by managers to make day-to-day and short-term decisions more efficiently and effectively to achieve desired outcomes such as increasing profit or delivering improved services.
Unlike financial accounting, which produces tax returns and annual reports, management accounting generates monthly or weekly reports for an organization's management and decision makers. These reports typically show items such as available cash, sales revenue, orders in hand, accounts payable and accounts receivable, and outstanding debts. An important aspect of Management accounting is determining what information management needs and communicating this effectively.
Clear Picture can assist with all aspects of management reporting including:
  • Strategic advice to managers about the financial implications of projects
  • KPI reporting
  • Explaining the financial consequences of business decisions
  • Formulating business budgets and business plans and strategies
  • Monitoring spending, financial control and Cashflow projection
  • Conducting internal business audits
  • Monthly/quarterly management reports
  • Product costing reviews.

Tax advice, tax planning and structuring advice

Tax Planning

Tax time is coming up. Are you prepared?
When the time comes to deal with your own taxation and accounts, it can be stressful and hassling. Though through good preparation and planning, you can make tax time work for you and potentially reduce the impact of tax, while keeping up to date.
Clear Picture are specialists at accounting and taxation. Based in XXX, we aim to provide our clients with comprehensive tax planning advice and strategies, all at competitive prices.
We provide assistance for:
  • Individuals
  • Families
  • Artists
  • Trusts
  • Businesses and
  • Organisations (non-profit and commercial)

--------------

Tax Planning

Tax time is coming up. Are you prepared?
When the time comes to deal with your own taxation and accounts, it can be stressful and hassling. Though through good preparation and planning, you can make tax time work for you and potentially reduce the impact of tax, while keeping up to date.
Clear Picture are specialists at accounting and taxation. Based in XXX, we aim to provide our clients with comprehensive tax planning advice and strategies, all at competitive prices.
We provide assistance for:
  • Individuals
  • Families
  • Artists
  • Trusts
  • Businesses and
  • Organisations (non-profit and commercial)

--------------

Structure

A client needs to put in place the right strategies and structures, to create wealth and then review these strategies and structures on a regular basis. That is because your circumstances and goals will change and so will the economy and the legislation relating to how your affairs are structured.
There are many paths that may be more appropriate than others such as:
  • Selecting the best tax structure;
  • Using gearing;
  • Reducing debt;
  • Using Shares, managed funds or other types of assets. Indeed it may be a combination of many to properly meet your needs.

Rental properties

Like any form of business, property ownership can be less than hoped for. However, rental income, gearing, purchase, borrowings, management, appropriate structures, and advice are how XX help clients who rent commercial and residential properties.
Our aim is to ensure such investments generate the appropriate returns.
We assist in a variety of ways:
  • Advice on funding
  • Advice with purchasing
  • Cash flow analysis of property investment
  • Guidance in tax related areas including negative gearing and capital gains tax
  • Advice on ownership structures
  • Preparation of initial land tax returns and land tax variation returns

Trusts

Trust Advice

A trust provides a valuable way of protecting the assets you have accumulated for the benefit of yourself and others. A trust can also be an effective structure for running your business.
We have extensive experience with trusts and are able to offer specialist advice on establishment and compliance, ensuring that all statutory requirements are met.
Clear Picture are also able to organise for the preparation and execution of documentation involved in Trust formation.
Our Trust administration service includes:
  • Minute keeping service
  • Annual accounts
  • Taxation
  • Maintenance of CGT register
  • Income distribution
We know the issues and requirements involved with managing Trusts and can help ensure these tasks are undertaken properly.

NZ Clients and temporary residency

NZ Clients and temporary residency

Clear Picture help New Zealand individuals and businesses — including temporary residents and recent arrivals — manage tax, compliance and financial planning so you can focus on settling in and growing your activities.

Services for NZ clients & temporary residents

  • Tax residency assessment and advice (determine NZ tax residency and obligations)
  • Income tax planning for residents and part-year taxfilers
  • PAYE, GST and IRD registration and compliance
  • Withholding taxes, foreign income disclosure and double tax relief guidance
  • Property tax, rental income and bright-line rule support
  • KiwiSaver advice, provisional tax and payroll setup for employers
  • Cross-border structuring and tax-efficient repatriation of funds
  • End-of-year tax returns, tax credits, and liaison with Inland Revenue

Get in touch for a tailored consultation to clarify your NZ tax position and compliance obligations.

Tax Diary

General Calculators

 

Accounting Videos

Secure File Transfer

Secure File Transfer is a facility that allows the safe and secure exchange of confidential files or documents between you and us.

Email is very convenient in our business world, there is no doubting that. However email messages and attachments can be intercepted by third parties, putting your privacy and identity at risk if used to send confidential files or documents. Secure File Transfer eliminates this risk.

Login to Secure File Transfer, or contact us if you require a username and password.